EVgo Q3 2026 Earnings Call - EVGO INC

Financial Performance:

• Q3 2026 total revenue was $91 million, a 1% decrease year-over-year (YoY) driven by a decline in non-core X-tend construction revenue ($16M vs $32M); core charging revenue grew 29% to $72 million.
• Charging network gross margin was 39% for the trailing twelve months (TTM), up from 37% the prior year period.
• Adjusted gross profit for Q3 2026 was $32 million, up 21% YoY, with an adjusted gross margin of 35% (vs. 29% in Q3 2025).
• Adjusted EBITDA for Q3 2026 was a loss of $3.5 million, improving from a $5 million loss in the prior year; TTM adjusted EBITDA margin was positive 1% (vs. negative 6% previously).
• Excluding OEM charging credits, daily throughput per stall grew 7% YoY to 270 kWh (excluding credits) and 283 kWh total.
• Balance sheet liquidity stood at approximately $787 million as of September 30, 2026, with $620 million available across DOE and commercial debt facilities.
• Total energy dispensed on the network was 392 GWh for the TTM, a 12% increase from the prior year.

Guidance and Future Outlook:

• Full-year 2026 revenue guidance is $375 million to $400 million; X-tend revenue is expected at $90-$95 million, and AV ancillary revenue at $30-$45 million.
• 2026 Adjusted G&A guidance lowered to ~$145 million (previously $150-$155 million) due to cost control measures; 2027 Adjusted G&A is expected to be ~15% below prior expectations.
• 2026 Adjusted EBITDA loss guidance tightened to $15 million to $30 million (previously higher losses implied by earlier cost structures).
• 2026 stall deployment guidance revised to 1,075–1,275 new stalls (including 600–750 public/AV and 475–525 X-tend), with some builds sliding to 2027.
• Long-term target: 70% of the network to be 350kW+ by 2028; NACS stalls to comprise two-thirds of the network by end of 2028.
• 2027 gross CapEx expected to be $100 million less than previous targets as the company deploys fewer, higher-quality sites.

Business Segments and Product Lines:

• NACS (North American Charging Standard) rollout accelerated to over 290 operational stalls (from 100 last year), with a target of 400 by year-end 2026; NACS now accounts for 9% of throughput, delivering a 35% higher charge rate than CCS.
• Tesla partnership progressing: First EVgo-branded Supercharger site open in Chicago, with a second in Houston expected Q4; over 20 stalls to open nationwide initially, representing the first of hundreds.
• Next-generation charging architecture unveiled, capable of 750kW with dynamic power sharing, touchless payments, and enhanced cable management; full design to be unveiled in 2027.
• Site portfolio expanded via partnerships with Brixmor (500+ new chargers, >25% of portfolio) and Regency Centers (400+ new chargers, >20% footprint increase), focusing on grocery/retail anchors.
• Network health improved: 70% of stalls are now 350kW or higher, down from 70% being 50kW in 2022.
• X-tend (construction) revenue is expected to trend lower, reaching $5–$10 million annually by 2028.

Market and Competitive Landscape:

• Auto OEMs standardizing around NACS, doubling EVgo's addressable market by integrating Tesla drivers via Superchargers and NACS retrofits.
• EV sales in the US showed a bottom in spring 2026 with recovery since, driven by seasonal factors and the ramp-up of used EV sales which rely more heavily on public fast charging.
• Used EV drivers identified as a key growth segment due to lack of home charging infrastructure and higher reliance on public networks.
• Competition addressed by evolving hardware from legacy 50kW to 350kW and upcoming 750kW systems, differentiating via proprietary design and customer experience (touchless payment, reliability).

Risks and Challenges:

• Slower-than-expected EV sales in the US and the elimination of federal incentives for EV purchases and infrastructure.
• Roll-off of low-margin legacy OEM charging credits, which previously distorted throughput and revenue metrics.
• Seasonal weakness in summer driving season traffic, impacting Q3 throughput per stall.
• Near-term pressure on throughput per stall as NACS connectors ramp and replace lower-performing legacy units.
• Capital deployment efficiency challenges, necessitating a shift to "fewer, better" sites to optimize returns.

Management Commentary and Tone:

• Management expressed confidence in the path to sustainable profitability, citing operating leverage and the ability to "dial up or dial down" growth expenses.
• Tone was cautious regarding short-term headwinds (OEM credits, EV sales) but highly optimistic about the long-term structural shift to NACS and network expansion.
• CEO Badr Khan emphasized that underlying throughput growth (7% YoY excluding credits) remains strong despite headline slowdowns.
• CFO Kiefer Lehner highlighted the company's positive Adjusted EBITDA position without growth expenses, reinforcing financial flexibility.

Analyst Questions and Answers:

• Christian Rinos (RBC): Asked about throughput drivers and NACS utilization. Management clarified that the 4% YoY decline in daily throughput per stall is temporary, masking 7% underlying growth once OEM credits are excluded. They noted NACS stalls currently have lower utilization due to driver familiarity but will accelerate as the fleet transitions, with early data showing higher charge rates.
• Chris Pierce (Needham): Inquired about used EV sales and their impact on throughput. Management confirmed used EV sales are rising consistently; these drivers rely more on public charging and charge at higher rates than new EV owners, providing a significant tailwind.
• Analyst Follow-up on Tesla: Clarified that while initial NACS utilization was lower, the data supports accelerating deployment as drivers adapt; the 9% current NACS throughput indicates strong latent demand.

Other Key Points:

• Board has formed a special committee to review an unsolicited, non-binding take-private offer from majority shareholder LS Power at $2 per share; no decision made yet.
• Company has 1.9 million customer accounts and over 10 million charging sessions annually.
• Total operating stalls reached 5,530 as of Q3 2026, a 20% increase year-over-year.
• AI is being leveraged for marketing campaigns and operational insights to increase throughput.
• Cost control measures in G&A (headcount, discretionary spend) are estimated to reduce Adjusted G&A by at least 15% below prior 2027 expectations.